The theme of this year’s Report is “Trade policy commitments and
contingency measures”. The Report examines the range of contingency
measures available in trade agreements and the role that these measures
play. Also referred to as escape clauses or safety valves, these
measures allow governments a certain degree of flexibility within their
trade commitments and can be used to address circumstances that could
not have been foreseen when a trade commitment was made. Contingency
measures seek to strike a balance between commitments and flexibility.
Too much flexibility may undermine the value of commitments, but too
little may render the rules unsustainable. The tension between credible
commitments and flexibility is often close to the surface during trade
negotiations. For example, in the July 2008 mini-ministerial meeting,
which sought to agree negotiating modalities — or a final blueprint —
for agriculture and non-agricultural market access (NAMA), the question
of a “special safeguard mechanism” (the extent to which developing
countries would be allowed to protect farmers from import surges) was
crucial to the discussions.

One of the main objectives of this Report is to analyze whether WTO
provisions provide a balance between supplying governments with
necessary flexibility to face difficult economic situations and
adequately defining them in a way that limits their use for
protectionist purposes. In analyzing this question, the Report focuses
primarily on contingency measures available to WTO members when
importing and exporting goods. These measures include the use of
safeguards, such as tariffs and quotas, in specified circumstances,
anti-dumping duties on goods that are deemed to be “dumped”, and
countervailing duties imposed to offset subsidies. The Report also
discusses alternative policy options, including the renegotiation of
tariff commitments, the use of export taxes, and increases in tariffs up
to their legal maximum ceiling or binding. The analysis includes
consideration of legal, economic and political economy factors that
influence the use of these measures and their associated benefits and
costs.